- DTV comparable store sales up 4.7 percent
- Retail comparable store sales up 3.1 percent
- Wholesale comparable store sales up 1.8 percent
CHICAGO, March 16, 2016 – True Value Company, one of the world's largest retailer-owned hardware cooperatives, today reported total gross billings of $2,033.2 million for the fiscal year ending Jan. 2, 2016, up 2.0 percent or $39.3 million compared to the prior year on a comparable 52-week basis. Revenue was $1,497.2 million, an increase of 1.3 percent or $18.6 million on a comparable 52-week basis. When comparing the 52–53-week fiscal year, reported gross billings were up 0.9 percent and revenue increased 0.1 percent, respectively.
Destination True Value (DTV) comparable store sales were up 4.7 percent for the fiscal year. The company also experienced its fifth consecutive year of increased annual sales as wholesale comparable store sales, on a gross billings basis, were up 1.8 percent for the year. Retail comparable store sales were up 3.1 percent with increases in every region of the country and across all product categories, led by Farm Ranch Auto & Pet, Lawn & Garden, and Hand & Power Tools.
“Our 2015 results demonstrate that True Value is investing in the future of the co-op for its members as we continue to focus on the strategic pillars of engagement, growth and efficiency,” said President and Chief Executive Officer John Hartmann.
The cooperative planned for a decrease in net margin in 2015, posting a net margin of $19.0 million for the year, driven by investment expense incurred in connection with the implementation of the company’s strategic plan. As committed, the company will pay a similar cash patronage dividend as last year.
“There has been a compelling amount of progress made in support of the plan as evidenced by our members’ success,” said Hartmann. “In 2014 and 2015, our growth averaged 3.5 percent on a gross billings basis—well above the historical levels. And for the five years prior to the start of our plan, retail sales averaged less than one percent. In 2015, retail sales increased 3.1 percent and DTV stores increased 4.7 percent. The work we are doing is making a difference and that is where our focus remains.”
The company has been making long-overdue investments in initiatives related to the engagement pillar with programs such as Customer Service Training and the rollout of the Roadmap to Retail Excellence, a tool to help diagnose and guide what actions retailers can take to achieve their goals. The Roadmap has already played a role in influencing store changes, leading to some fantastic success stories.
“True Value introduced me to the Roadmap to Retail Excellence and helped me develop a plan to achieve greater growth and profitability,” said Lee Bryant of Bryant True Value of Corbin. “We’ve experienced more growth in the last year than we have in the last 20 years thanks to guidance and help from the co-op.”
My True Value – A New Customer ExperienceSM is helping members train their people to create defining moments with customers. To date, over 1,000 store owners and their associates have become “chat” certified. They are well on their way to providing those defining moments that create loyalty with customers.
Investment in the growth pillar assisted retailers with creating a relevant consumer experience and improving member profitability. DTV is a proven format that consistently provides returns for True Value members. In 2015, the cooperative announced a more flexible, affordable DTV making it easier than ever before for members to update their stores. As such, in 2015 the company added nearly a million square feet of DTV retail space.
“The momentum we have after implementing DTV has changed our lives and our business,” said CC Gibbs of Gibbs True Value. “We see young people shopping our store rather than going to the big box stores, and we are now more profitable than we ever thought we could be.”
In addition to expanding relevant formats in its network, a number of multi-store chains converted to True Value in 2015 including Busy Beaver, Miami Home Centers and National Lumber.
“Becoming a part of the True Value family and having access to exclusive brands further supports our competitive edge,” said Dan Hitchcock, owner of Miami Home Centers. “One of the primary drivers of converting to True Value was being able to offer our customers their private label paint Easy Care,” said Hitchcock.
Centered in the efficiency pillar was True Value’s fleet transition to Ryder Integrated Logistics, providing dedicated fleet services to support deliveries from True Value’s regional distribution centers. Transitioning to Ryder provides huge savings to help stabilize delivery costs and the long-term sustainability of high touch delivery. The new trucks, new technology and a larger driver pool will greatly advance the cooperative’s journey to best-in-class service.
“Momentum is building at True Value, and we are focused on serving our membership rather than allowing the membership to serve the co-op,” said Hartmann. “We are at a pivotal time in our history, and are navigating a transformational path towards greater member growth and profitability. And we’re just getting warmed up.”
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